Kearney's 2025 Reshoring Index falls by 311 points

Kearney’s 12th annual Reshoring Index report saw its index score fall by a massive 311 points (after two very positive years), providing a reality check on American manufacturing readiness. The consulting firm in March 2025 conducted the survey, which tracks the extent that America is reshoring manufacturing from Asia.

The index score is calculated by dividing the import of manufactured goods from the 14 Asian low-cost countries and regions (LCCRs) by the US domestic gross manufacturing output to calculate a manufacturing import ratio (MIR).

The MIR increased by 9%, back to pre-Covid levels, as imports from the LCCRs (+10%) grew much faster than US domestic manufacturing gross output (+1%).

The weak 1% growth of US manufacturing output reflected a longer-than-expected lag between investment announcements and operational capacity coming online.

Meanwhile, nearshoring partners Canada and Mexico saw their exports to the US contract.

"As US demand outpaced what domestic production could supply, Mexico was not able to fill the gap. So, we saw manufacturers reverting to sourcing from those distant Asian low-cost countries and regions they had relied on in the past," said Omar Troncoso, Kearney partner and report co-author.

Imports from the 14 Asian LCCRs increased by 10%, or $90 billion.

The Kearney report found that the share of CEOs planning to reshore operations in the next three years increased by 15% year-over-year. Moreover, there was a 50% rise in CEOs citing geopolitical tensions as the main motivation for reshoring.

President Donald Trump has declared a trade war against the world – especially China, who he has hammered for unfair trade practices. The level, duration, and geographical extent of US tariffs will make the 2026 Kearney report significantly more interesting than this year's edition.

Ninteteenth-century-style protectionism may not be enough to drive a US manufacturing golden age, however.

"This year's Reshoring Index report reveals a hard truth. While CEOs are more committed than ever to reshoring, the US domestic manufacturing ecosystem is still playing catch-up. The next phase will require not just capital, but coordination," said Patrick Van den Bossche, Kearney partner and study co-author.